BackAmid mass layoffs, Ashneer Grover explains why he ‘never had to fire people’
Even as tens of thousands lose their jobs across the world, Ashneer Grover noted that he had ‘never had to fire people because of bad markets’.
PremiumAs layoffs hit thousands of tech employees across the world, BharatPe founder Ashneer Grover noted that he had ‘never had to fire people because of bad markets’. Several multi national tech giants have shed jobs in recent weeks as they look to rein in costs and ride out the economic downturn.
“It’s sad to hear about firings every day. I am thankful that I’ve never had to fire people because of bad markets - because I’ve always hired considerately. As a Founder you’ve to think about the long game," the Third Unicorn co-founder wrote on LinkedIn today.
Grover suggested that salary reductions could work as an alternative to mass firings. As he put it, people joining him would only have to worry about building and growth. “I’ve got my team’s back."
“I had posted about 25% - 40% salary reduction a while back as an alternative to mass firings. I just don’t get it why Founders won’t go down that path. Everything gets repriced - energy, capital, technology. Why not people? Glad I’ve put on myself a max cap of 50 people in The Third Unicorn," he added.
Earlier in November last year, Grover had spoken at length about the need for “cost cutting to extend runway" and the concept of “real salary vs paid salary".
“In 2021, the real salary (at which markets clear) at which your employees were getting poached was higher than the salary you were paying. In 2022 the real salary at which people will find jobs (if at all) if you let them go is lower than salaries you are paying. So if you think you will need people back - simply reduce salary by 25% (40% in case of tech employees) rather than doing mass layoffs. It’s a better solution as rehiring will be really uphill and costly. Reinstating salary is click of a button away," he had urged founders in another LinkedIn post.
In the first three weeks of January, Google parent Alphabet has eliminated 12,000 jobs, while Microsoft is laying off around 10,000 workers. Amazon's layoff round will impact more than 18,000 roles. Other tech companies like Facebook-parent Meta and Elon Musk's Twitter laid off thousands late last year.
It if not yet clear whether these firings will affect employees in Asia. As per the layoff memo sent out by Google's Sundar Pichai, overseas layoff notifications will take longer due to local employment laws. As such, employees in Asia will learn starting in February if the reduction impacts them.
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